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After gaining significant momentum in the last quarter of 2024, Tesla (TSLA) stock is down over 43% from its all-time highs right now. With a market cap of $875 billion, the electric vehicle (EV) maker has grossly underperformed the broader market in 2025.
According to a report from Teslarati, Canaccord Genuity has maintained its bullish $404 price target for Tesla stock. Following a visit to Tesla’s Gigafactory in Texas, the investment bank reaffirmed a “Buy” rating on TSLA. Notably, Canaccord revised its Q1 2025 delivery estimate to 362,000 vehicles, up from its previous projection but still below the consensus estimate of 417,000 units.
It attributed the delivery gap to production constraints rather than declining demand, noting that many consumers are likely delaying purchases until the refreshed Model Y becomes available. “We wonder whether purchase decision delays and production limitations are being misinterpreted as halted overall momentum for Tesla,” the firm stated in its report.
The Canaccord team expressed optimism after touring Giga Texas, impressed by Tesla’s “future-forward” manufacturing and vehicle design approach. It highlighted progress with Full Self-Driving version 13.2.8 and mentioned that Tesla's robotaxi services will launch in Austin this summer.
“For investors with duration and grit, there is a silver-linings playbook,” Canaccord concluded, echoing CEO Elon Musk’s recent advice to invest in companies with products people love, regardless of short-term stock volatility.
Is Tesla Stock a Good Investment Right Now?
In Q4 2024, Tesla achieved record vehicle deliveries and energy storage deployments, highlighting its dual-pronged growth strategy across the automotive and energy sectors.
The electric vehicle maker continues to optimize manufacturing costs, with Q4 seeing vehicle production costs drop below $35,000 per unit — the lowest level ever — driven primarily by raw material cost improvements. This efficiency helped Tesla partially offset investments in financing and lease options aimed at improving affordability for consumers.
While Q4 operating income decreased 23% year-over-year to $1.6 billion (6.2% operating margin), Tesla maintained strong cash flow dynamics with $4.8 billion in operating cash flow and $2 billion in free cash flow for the quarter. The company ended 2024 with $36.6 billion in cash, cash equivalents, and investments, a $7.5 billion increase from the previous year.
Tesla’s energy business emerged as a bright spot, achieving record deployments for both Powerwall and Megapack at a combined 11.0 GWh in Q4, resulting in this segment’s highest-ever gross profit contribution. The recently completed Shanghai Megafactory will begin ramping production in Q1 2025, supporting projected energy storage deployment growth of at least 50% year-over-year.
Tesla has adjusted its product strategy for 2025. It has announced that new vehicles, including more affordable models, will utilize next-generation and current platform technologies, enabling production on existing manufacturing lines.
This approach sacrifices some cost reduction potential but allows Tesla to grow vehicle volumes efficiently. The company aims to reach nearly 3 million vehicles annually — representing over 60% growth from 2024 — before investing in new production lines.
Tesla’s long-term vision includes the Cybercab robotaxi, scheduled for volume production beginning in 2026. Preparations for Semi truck production continue, with first builds planned for late 2025 and a volume ramp beginning in early 2026. Tesla expects 2025 to be “a seminal year” as it aims to launch unsupervised FSD and introduce robotaxi services in parts of the United States.
What Is the Target Price for Tesla Stock?
While Tesla’s sales growth was marginal in 2024, the company is forecast to increase its top line by 12.1% to $109.5 billion in 2025 and by 19.9% to $131.25 billion in 2026. Analysts forecast adjusted earnings to expand from $2.42 per share in 2024 to $9.54 per share in 2030.
Out of the 40 analysts tracking TSLA stock, 15 recommend “Strong Buy,” three recommend ‘Moderate Buy,” 12 recommend “Hold,” and 10 recommend “Strong Sell.” The average target price for TSLA stock is $338.94, 23% above the current trading price.
